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I’m getting stuck on this topic. We have some denied loans on the LAR that never made it far enough to order an appraisal to review in order to have a property value or CLTV to rely upon. However, there is documentation in the file that show an estimated property value given by the applicant with CLTV calculated off of that number. Our underwriters are telling us that they do not rely on this number but they are required to put something in the software in order to get DU to run and they are also required to put something on their underwriting transmittal in order to get their initial findings not related to the property. My fear is, if I have a transmittal or AUS underwriting findings listing a number in the file, then this could be perceived as it was relied upon. I guess my question would be is an estimated number considered to be relied upon? Especially, if it is ran through underwriting software? There will never be documentation in the file to support that we did not rely on this estimated number and I’m afraid that written procedures would not capture every scenario.
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